For the past three months, Hong Kong has been engulfed in protests that have transformed the social and economic landscape of the city. Thousands have flocked to the streets since July, voicing their discontent over an extradition bill that many fear could undermine the region's autonomy. As the protests evolved, they began to encompass broader issues like police action and the integrity of Hong Kong's democratic system. Among those feeling the pinch are the city’s billionaires, particularly the Kwok family, who owns Sun Hung Kai Properties, the largest real estate developer in Hong Kong.
The financial turmoil has been palpable, with shares of Sun Hung Kai Properties plummeting by 11% since mid-June—this decline is twofold compared to the overall Hong Kong Seng Index. The Kwok family, recognized as the richest family in Hong Kong and the second-richest in Asia, boasts a staggering net worth of $38 billion. However, they are losing wealth at a rate unmatched by other billionaires in the region.
Raymond Kwok, the chairman of Sun Hung Kai, has personally lost $1.7 billion since July 21, while his brother Thomas, who was recently released from prison after serving time for bribery, has seen a $1.5 billion decrease in his fortune. This financial fallout is primarily due to their heavy reliance on two sectors severely impacted by the protests—retail and tourism. Unlike other real estate moguls who diversify their investments or own properties abroad, the Kwoks have concentrated their efforts solely on Hong Kong.
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Several of Sun Hung Kai's properties have become focal points for protests. The New Town Plaza, an upscale shopping mall owned by Sun Hung Kai, has witnessed violent demonstrations, with images circulating on social media that starkly depict the chaos, including a woman in a designer bag fleeing a scene marked by violence.
On August 13, the company took a firm stand against the turmoil, declaring that the recent violent acts challenging the rule of law have significantly harmed Hong Kong's economy and disrupted the daily lives of its citizens. This sentiment reflects the broader understanding that the net worth of Hong Kong's billionaires is highly sensitive to market fluctuations. Notably, the high-net-worth population in Hong Kong experienced a staggering 13% drop in collective wealth in 2018, far exceeding the global average decline of 3%.
What You Will Learn
- The ongoing protests in Hong Kong and their impact on the local economy.
- The financial losses faced by the Kwok family and their business ventures.
- The specific sectors that are most affected by the protests.
- Historical context regarding the wealth volatility of billionaires in Hong Kong.
